March 30. 1949
Hon. William L. Kerr, President
Board of Regents
State Teachers Colleges
First National Bank Building
Midland, Texas Opinion No. V-798
Re: Availability of funds col-
lected through the tax lev-
ied under the College
Building Amendment to
the Texas Constitution.
Dear Mr. Kerr:
You request the opinion of the Attorney General as fol-
lows:
“It has been announced that the litigation concern-
ing the college building amendment has been brought
to a close with the overruling of motions for rehearing
in the Supreme Court. Therefore, it becomes import-
ant that we of our Board know of our authority to obtain
or pledge funds realized from the tax levy heretofore
made. During the pendency of litigation, as we under-
stand it, the authorized tax was levied for the benefit
of our colleges and collection has been made from this
levy.
May we, therefore, ask your opinion and advise
as follows:
‘1. Will the present collected funds (in proper pro-
portionate part) be available to the State Teachers Col-
leges for authorized buildings, even though bonds have
not as yet been issued?
“2. May our Board of Regents request transfer of
present accumulated funds from the treasury to the re-
spective colleges under our jurisdiction to permit such
funds to be used for building construction?
,
Hon. William L. Kerr, Page 2 (V-798)
“3. If such a transfer of present funds from the
treasury may not be permitted, may the Board author-
ize building construction, payable out of funds already
collected and presently held by the State Treasurer?”
We quote the following from this Constitutional Amend-
ment:
u
there is hereby levied, . . . a State ad valo-
rem tax’dn property of five cents (Se) . ,.,~. for the pur-
pose of creating a special fund for the .purpose of ac-
quiring, constructing, and initially equipping buildings
or other permanent improvements at the designated in-
stitutions of higher learning: and the governing board
of each of such institutions of higher learning is fully
authorized to pledge all or any part of said funds allot-
ted to such institutions as hereinafter provided, to se-
cure bonds or notes issued for the purpose of acquiring,
constructing and initially equipping such -buildings or
other permanent improvements at said respective in-
stitutions. Such bonds or notes shall be issued in such
amount as may be determined by the governing boards
of said respective institutions, shall bear interest not
to exceed three (3%) per cent per annum and shall ma-
tur.e serially . . . .”
This Amendment further provides:
“Funds raised from said Five (5.C) Cents tax . . .
are hereby allocated to the following institutions of
higher learning, and in the following proportions to wit:
”
. . .
Section 17 concludes:
“This amendment shall be self-enacting. The State
Comptroller of Public Accounts shall draw all neces-
sary and proper warrants upon the State Treasury in
order to carry out the purposes of this amendment; and
the State Treasurer shall pay warrants so i.ssued out of
the special fund hereby created for said purpose.“’
Assuming for the purpose of this opinion that the funds now
on hand have been allocated, or credited to the respective State Teach-
ers Colleges. it is. clear that the Board of Regents has the authority
by the express terms of this Amendment to the Constitution,to issue
Hon. William L. Kerr, Page 3 (V-798)
bonds or notes to be secured by a pledge of these funds. The bonds
require the approval of the Attorney General, but the notes provided
for in Section 17 do not. Both the bonds and notes issued by the
University of Texas and A. and M. College require the approval of
the Attorney General. This Constitutional Amendment clearly pre-
scribes the terms and conditions of the bonds and notes, and makes
no other provisions for evidencing of liability against the fund ex-
cept by the issuance of bonds or notes. Hence it is our conclusion
that this special fund may not be withdrawn from the State Treasury
except to pay principal and interest requirements of bonds or notes
issued under Section 17.
The issuance of short-term notes or bonds should serve
the purpose of facilitating the payment of obli.gations legally incurred
by the governing boards in the furtherance of the purposes author-
ized by this Amendment. You will observe that there is a maximum
date of maturity provided, but no minimum date. It would, there-
fore, be permissible for the governing boards to issue short-term
bonds or notes. Funds already collected and in the Treasury may.
of course, be used for the payment of such bonds or notes.
There is necessarily involved in your request, though not
definitely presented, the question of whether or not these funds are
subject to legislative appropriation as a prerequisite to expenditure
by the colleges. We deem it appropriate to answer that question
now. The answer is in the negative. This Constitutional Amend-
ment, by its express terms; is self-enacting in all of its details. It ’
specifically levies the tax, designates the use to which the fund cre-
ated by the tax levy shall be applied by the Board of Regents, and
directs the Comptroller to tissue and the State Treasurer to pay war-
rants drawn upon this special fund thus created. An appropriation
in a constitutional sense may be by legislative act or constitutional
declaration. This is of the latter class. The effect of the explicit
directions found in this Constitutional Amendment, now a part of the
organic law of this State, levying the tax. creating a special fund
from such levy, specifying the purposes for which it may be spent,
and directing the manner of its disbursement, clearly remove this
special fund from the limitations of Article VIII, Section 6 of the
Constitution of this State, which provides: “No money shall be drawn
from the treasury but in pursuance of specific appropriation made
by law; nor shall any appropriation of money be made for a longer
term than two years.” City of Aransas Pass v. Keeling, 112 Tex.
339, 247 S.W. 818; Braeos River Conservation & R. District v. Mc-
t;;w, 126 Tex. 506, 91 S.W. (2d) 665: Dorsey v. Petrott, 12 A. (2d)
.
240
Hon. William L. Kerr, Page 4 (V-798)
SUMMARY
The accumulated funds from taxes levied by virtue
of Section 17 of Article VII (the College Building Amend-
ment) may be allocated by the Comptroller to the re-
spective colleges entitled to receive the same in propor-
tion to the formulas provided in such constitutional a-
mendment for the payment of bonds or notes issued
thereunder. No legislative appropriation of such funds
is necessary since the amendment is self-enacting.
Very truly yours
ATTORNEYGENERALOF TEXAS
BY
LPL/mwb
APPRO,VED
v IRST ASSISTANT
ATTORNEY GENERAL